JPMorgan Chase: Expects Robinhood Crypto Business Revenue to Decline in Q1 Following Record High at the End of 2024

On April 30th, Kenneth Worthington, an analyst at JPMorgan, predicted that Robinhood (HOOD) might have difficulty maintaining its record-breaking cryptocurrency trading revenue in the fourth quarter of 2024. It is expected that the digital asset trading volume may decline in the first quarter of 2025. The trading platform is scheduled to release its first-quarter earnings report after the market close on May 1st. The report shows that Robinhood's cryptocurrency trading revenue surged by 700% in the last quarter of the previous year, which led to a significant increase in overall trading revenue. However, due to the late-quarter stock and bond sell-off and the cryptocurrency market pullback in the first quarter, the quarterly cryptocurrency trading volume is expected to decrease from $71 billion in the fourth quarter to $52 billion. The Assets Under Custody (AUC) is expected to decline by 5% quarter-over-quarter, but still show a 41% year-over-year growth. Although the retail buying frenzy was stimulated by the U.S. tariff policy in early April, analysts believe that it will be difficult to reverse the first-quarter downturn. Weak demand for margin and derivative trading may further drag down performance. JPMorgan maintains a "Neutral" rating and cuts the target price by $1 to $44, indicating a potential downside of about 10% from the current $49 share price. (CoinDesk)